TyroCity: Business Studies XI Notes

Office accommodation and layout

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Meaning of office accommodation
It is the process of selecting appropriate building in a favorable location, establishing different sections and departments, proving or arranging resources in a scientific way. The purpose of office accommodation is to create sound working environment and to bring efficiency and rapidness in office work. It is important for both employees and outsider. Office employees spend a long time office. Bad accommodation can cause boredom and frustration among employees. Bad environment also may cause bad impression to outsiders.

Selection of office building

1. Shape and size of office building
It is one of the major factors that should be considered while selecting office building. It should have adequate space to accommodate all machines, equipment, and employee with furniture and enough space for flexibility. It should be considered taking the base of both present and future needs.

2. Lighting and ventilation
An office building should have adequate lighting and ventilation. It helps a lot to increase efficiency and enhance worker’s morale. Well lighted and ventilated accommodation puts less pressure on the employees and also reduces the physical and mental strain and consequently the efficiency is higher.

3. Convenience to customers and employees
While selecting office building it should consider the convenience of customer and employees. It should not be far from the related trade center, must have proper toilet and canteen services and food hospitality and utilities.

4. Cost
The cost of building effects on total budget of organization. The building purchased or built must be within the budget of organization. There should be balanced between requirement of space, capacity of the organization and the cost for covering the expanses.

5. Flexibility
Flexibility of office building in its shape and size should be considered while selecting the office building. It must also match the nature of organization.

6. Layout facility
The efficiency of men and machine depend upon the layout. The proper layout makes office attraction. For this furniture, machine and other goods are necessary. This also helps in the internal arrangement of office.

Selection of office location:

Nearness to customer: The office should be accessible to customers. They do not like long distances to make business inquiries. The office should be accessible to other parties who are in regular contact.
Nearness to related business: It is desirable to locate the office near the offices of related business. It should be established in the same line of trade.
Availability of infrastructure: The infrastructure should be available in office location. It consists of transport, communication, power, water and parking facilities.
Nature of business: The nature of business affects location of office. Office of manufacturing business in located near the source of raw materials, labor and service facilities. Office of trading and banking business is located in commercial centers near the customers. Office of perishable goods business is located near the market for such goods.
Availability of human resources: Needed human resources should be available for office. They can be skilled, semi-skilled and unskilled. All facilities must be available for employees
Environment: The office location should have healthy environment. It should not be near polluted rivers or waste disposal sites. It should be free from noise, dust and pollution.
Cost of space: Sufficient space should be available at reasonable cost for the office. Space should be available for future expansion.
Government laws: The selection of location should comply with government laws and regulation at national and local levels.

Office layout

Meaning of office layout
It is systematic arrangement of office amenities. It is arrangement of staffs, machines, equipment, furniture and other physical facilities within the limit of available floor space. Its purposes are to utilize space in the best possible manners, to make the outlook of the office attractive and to increase efficiency of the staff. It is defined as arrangement and placing of men, material, machines and money to the optimum level.

Main aims are

To utilize the floor space properly
To run the office work smoothly
To help for the motivation of person.
To help for the minimization of physical hazards and accident
To make proper supervision
To maintain the attractiveness for impressing the customers and visitor.
To try for the provision of comfort and satisfaction of employees
To help to provide security

Principle of office layout

1. Principle of flow of work:
It is the layout which helps for smooth and effective flow of office works. Simple, easy and prompt work flow and essential for work progress

2. Principle of free movement and observation:
Office layout should allow the free movement of employees. There should also be proper supervision and observation of works of movement too

3. Principle of effective supervision:
There should be free supervision of flow of works, movement of personnel, cost, wastage, balance of budget, quality of office works etc.

4. Principle of departmental relationships:
For the office layout related departments are inter related and those inter related departments should be placed side by side.

5. Principle of flexibility:
Office should be flexible enough to facilitate the expansion in the future.

6. Principle of maximum utilization:
As the time flows, there is increase in cost of every thing as per the situation of the economy if the country and the area where office is established. There are very fewer cases of deflation basically in developing countries. Therefore, when office is set up then there must be maximum utilization of employees, materials, space, machines and resources. There should be reduction of wastage.

7. Principle of pleasing appearance:
Interior design, lighting, ventilation and cleanliness should be maintained. Office must be well furnished and pleasing enough to make it attractive to all the customers and visitors

8. Principle of good ventilation:
Office must have enough doors, windows, and ventilation for constant supply of fresh air.

9. Principle of good lighting:
Office should try to provide natural light that is sunlight. Dark places should be avoided for establishment of office.

10. Principle of safety:
An office layout must be based on the safety. It should reduce office accidents like theft, fire, damage and so on. Office machine must be implemented properly

11. Principle of service facilities:
There must be provisions of good canteen, lights, lifts, telephone, and toilets.

12. Principle of providing private offices:
In an office. Separate rooms should be provided to some important employees. If the work is confidential in nature then private room should be provided. It is better to use movable partition to provide privacy

Steps in designing office layout:

1. Securing the blue print of the organization
It is the first step to secure the blue print of office building to know about the space available of office works. It should be secured from top management. Its blueprint is not available then the space should be measured and the sketch of building should be made

2. Assessing the need of the organization
Need of all department should be identified. Managers should consult the department heads to access space requirement. Number of employees, method and nature of works, equipment and machines. Present and future requirement should be determined. It is the second step of designing the layout

3. Arranging templates:
It is the third step in designing the office layout. The manager should prepare model known as template. Templates are thin plates of board or metal that represents actual space with decorations. They provide tentative design of office space. Several adjustments, change might me made before final model is finalized.

4. Indicating the electric wiring:
While designing the office layout, electric wiring should be properly managed. The location should be properly wired to avoid the risk of short circuits and fluctuation of voltage.

5. Submitting the plan to top management for approval:
After making plans and policies, it is submitted to the various departments. The plans must be discussed with the departmental heads and supervisors. They check the plans and finally approve it. Then only the plans are ready to be implemented

Characteristics of partnership firm

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Unlimited liability
Proprietor is liable for all the debts of the business. In case the assets are insufficient to meet the debts, the personal property of the proprietor can be attached.

Difficulty in transfer of shares
Partners cannot transfer their share without the consent of other partners. There may be conflict when done otherwise.

Higher capital
Many partners invest capitals and there is higher flexibility in capital because new partner can be agreed to be associated and investing can be increased.

Reduced risk
Partners have right to take part in management. They have the duty to bear risk with proportion too.

Association of two or more persons
It must be two or more person to enter into contract. Association of two or more persons can only create partnership. In association of two or more persons, maximum and minimum number of persons is not mentioned.

Agreement
It is set up by agreement between partners. It must be written and legal agreement so that it will reduce dispute.

Concept of cooperative organization

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Meaning and concept
Co-operative organization is the form of organization where in persons voluntarily associate together as business being a basis of equality for promotion of economic interest of themselves. It is a voluntary association of persons with same interest. It is guided by service motive. It is established for economical and social development of weaker section of the society. It tries to solve similar problems. In all form of business organizations, the objective of owner is to make profit. But its objective is to provide services. Its motto is all for one and one for all. It helps through mental support too. It can be defined as voluntary association of person usually of limited means forming together in equal basis for promotion of certain economic or business interest.

Differentiate between sole trading and partnership

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Sole trading concern	Partnership firm
1. Low capital	1.high capital
2. One man management	2. two or more partners
3.quick and prompt decisions	3. Delay in decisions
4. business secrets can be maintained	4. difficulty in maintaining business secrets
5. risk and losses are to be born by a single person	5. there is reduction of risk and losses because they are shared with proportion of capitals by partners
6.no chances of conflict	6. Higher chances of conflict
7. lack of managerial ability	7. harmonization of managerial ability
8.chances of wrong decisions	8. Specialization in decision-making

Types of indexing

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Types of indexing are listed below:

1. Book index

It is mostly found in register books, notebooks etc. It is simple type of indexing. In this index, book is market with alphabets on the right side of the paper in such a way so that all alphabets can be seen at a glance. Here, name of persons or documents are arranges in alphabetical order. All the related files are kept in same alphabetical section. For example, telephone diary.

Advantages

Simple method
Economic
Safety
Disadvantages
Inflexible
Problem of alphabetical order
Inconvenient

2. Loose-leaf index
It is improved form of book index. In this type of indexing, instead of using hard hound register book, book sheets or paper are used in which alphabets are market on the rig hand side of the pages. It is very flexible and cheap. It is simple to operate an easy to understand. New sheet can be easily added and can be removed easily. But there is chance of misplacement of sheets.

3. Vowel indexing
It is improved form of book index. It is generally used by large organizations. Index book is maintained on the basis of vowels. Pages are firstly selected by initial letter and then by vowel occurred after the initial letter. For example Gandhi will be recorded in section “g” and in vowel “a”. It is time-consuming. It is difficult to search when many names begin with each alphabet.

4. Visible card indexing
Here, cards are arranged in flat tray or metal frame. Each card is attached to metal hinge. Name address and other documents are visible by touching other cards. Trays are attaché vertically to metal stands. Details can be written or typed in front and back of cards. Less space is used and cards can be easily located. It saves the time. It is flexible

5. Wheel index
It is modern form of visible index. It is suitable for big organization. Here, cards are mounted round the hub of wheel. A single wheel can hold as many as 5000 cards. In these cards can taken out or inserted without disturbing other cards. It is arranged alphabetically. Wheels are rotated to find card.

Advantages

Speedy performance
Requires less space
Flexible in nature
It saves time
Disadvantages
It is costly
It is not suitable for small organization

6. Strip card index
One line entry is made in narrow strip made up of thick cardboard paper which is fitted in a frame in such a way that all the strips fitted in the frame are visible at a glance. It is flexible and expensive. There is lack of secrecy and is difficult to operate.

Importance of business communication

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Importance of business communication are listed below:

1. Managerial efficiency: Communication helps in the smooth operation of management. A managerial task can only be performed when the communication system is effective.

2. Enhance morale and relations: Effective communication emphasizes the employee’s participation in management. It helps to build the employees morale and cordial industrial relations between management and employees

3. Effective leadership: Effective leadership depends on effective communication. Two-way communication helps in effective communication. A managerial leader must handle the subordinates. For ordering qualitative leadership is essential. And that can be obtained from a proper system of communication.

4. Mutual trust and confidence: Mutual trust and confidence between labor and management are necessary for the effective movement of the organization. When there is effective communication, it helps to reduce misunderstanding and develop mutual trust.

5. Better decision: The success of an organization can be measured in better decisions. When the information, data and other fact are not effectively communicated, it hampers the decision-making. So, when the facts are communicated to concerned department, organization and person. It is easy to make decisions promptly.

6. Staffing: When the information are correctly communicated in time, it helps in the function of selection, placement, socialization, promotion, and transfer.

7. Better managerial concern: All managerial functions such as planning, organizing, directing, controlling, etc can’t be conducted without communication.

Evolution of industry and commerce

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Evolution of business

The historical development of business and its processes of development up to now is called evolution of business. Business was not evolved in one or two days. It can be studied in two ways.

Evolution of industry

It is dated with the evolution of human beings. It is as old as human civilization. It was developed through various stages.

1. Hunting stage
In ancient times people lived in caves and fulfilled their basic needs of food and clothes through hunting the wild animals in forest. They were not civilized and hovered here and there. Their needs were also limited.

2. Pastoral stage
The stage of further development of human from barbarism is called pastoral stage. This stage is basically called the age of keeping animals. Animals were used for milk, meat, wool, skin and so on beyond food and clothes. The wants went on increasing and development also started.

3. Agriculture stage
Slowly, human beings became a little bit civilized and got idea about farming and keeping cattle. This stage was the major stage of development of industry. In this stage people started to do agriculture and live in river banks. They started to cultivate crops and domesticate the animals.

Development of agriculture is divided into 5 stages they are

Handicraft stage:
It is the beginning of industrial era. It is the stage of development of industry. Simple hands made tools were also developed. Local resources were the major source of raw materials. In the beginning of this stage people were only limited to their own needs but later own surplus products were used to exchange the goods with the roods basically called barter system. Products were exchanged with product and market was starting to develop. Capital invested was minimized.
Guild stage:
It was the beginning of organized activities. Organized groups of traders, craftsmen, artisans used to collect various resources from the local areas and produced goods using them.
Age of domestic system
After the stage of guild the age of domestic system was initiated. Crafts men were not able to fulfill the unlimited and increasing wants of people by using the limited resource. So, use of hands and tools for producing quality goods was introduced. People were employed and were paid according to the units of goods produced. However, salary was very low because the value of money was much higher at that time.
Industrial revolution
It began with the replacement of old system. It is the turning point of modern industrialization. Domestic system of production was replaced by large scale factory system. There was invention, innovation. Development of scientific techniques which encouraged mass production and distribution. There were numerous job opportunities. Salary was increased and quality was maintained.
Present age
Today’s modern era with industrialization, use of technology, computerization, modernization robotizing is the most developed stage of industries. Goods are being produced meeting the demand of large number of people. There are huge number of industries producing large number of goods to meet large amount of needs and wants by providing many jobs and salaries.

Evolution of commerce

It is related with the distribution and exchange of goods and services. It is related with transportation, communication, Banking, warehousing import export, trade and so on. It links between producer and consumer. It gradually develops along with the development of human and society. There are many stages of evolution of commerce

1. Self sufficiency stage
It is the initial stage of commercial evolution. The wants are very limited. In this stage people produced goods themselves to satisfy their own basic needs. They survived through hunting and gathering foods. There was no market. There was thus no exchange of goods. They were independent.,

2. Barter system
The wants of people increased with development of society. There was both advancement and civilization of market. Self-sufficiency stage didn’t remain with advancement. They started to exchange the goods they produced with goods that other people produced to fulfill other requirements. This is called barter system. There was exchange of goods and services with goods and services.

3. Origin of money
From the beginning of barter, people felt that there was difficulty in deferred payment, commerce, divisibility and place of exchange. That’s why money was originated. People developed coins but there was difficulty in large payment. So paper money was introduced. Money was used as medium of exchange, Measurement of value, deferred payment, redistribution of income and wealth, credit system and many more. After the origin of money, national and international trade started.

4. National economy
In this stage, buying and selling of goods and services was done within the country. The local market converted into regional and city market. There was division of work and specialization. Then goods were produce not only for local people but also for national market. There was also development in banking, advertising, insurance, warehouse and other auxiliaries.

5. International economy
International economy s called global economy. The globalization of trade introduced to speed up the activities of trade in the international level. It is not possible for a country to produce all demanded goods according to needs and wants. Therefore, the countries started to import the goods and other countries exported. Slowly, import and export was introduced in all counties. Trade started to extend in world market. WTO (world trade organization) was also established to control the level of import, export and evils associated with them.

Difference between private company and public company

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Bases of difference	Private company	Public company
Number of members	It needs at least 1 member for its formation. The maximum number can be 50.	It needs at least 7 members for its formation. The maximum number is not limited.
Invitation for capital	It cannot invite the public to buy its shares	It is free to invite the public to buy its shares
Commencement of business	It can commence the business immediately after the incorporation	It can commence the business after receiving the certificate of commencement of business.
Issue of prospectus	It does not need to issue prospectus	It must issue prospectus
Statutory meeting	It does not need to hold statutory meeting and file statutory report.	It must hold statutory meeting and file statutory report
Transfer of shares	The transferability of share is not allowed and hence its ownership cannot be transferred	The transferability of share is allowed and hence its ownership can be transferred
Use of word	It must use the word Pvt. Ltd. at the end of its name.	It must use the word Ltd. at the end of its name

Concept of public enterprises

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Public enterprise is an organization which is owned, managed and controlled by the government. It is necessary for the active participation of government in individual and commercial level. It is financed and operated by the government. It provides service to the public. It provides goods and services to the public at reasonable price. It is guide by service motive but it can earn nominal profit. It helps in maintaining the state of ownership and operation of industrial, agricultural, financial and commercial undertaking. It is one autonomous body which is managed and owned by government and which provide goods/ services for public.

Sources of office information : internal and external

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Internal communication
All the communication that takes place in carrying out works and tasks within a business is known as internal communication. It is helpful for office works. This is the communication that takes place among the business managers, employees and workers to create, implement and to make plans. It helps to maintain coordination. It is classified into inter departmental and interdepartmental It includes letters, memos, reports, announcement, circular etc.

External communication
When people of one organization transmit information to the people of other organization, then that communication is called external communication. It maintains good relationship with outsiders such as supplier, customers etc. It is very important for the business. It is classified into two types: Inward communication and outward communication.

Characteristics of Business

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

1. Human activities:
Business cannot be performed without human efforts. The main aim of business is to produce goods and services to fulfill the requirement of human being internally associated in the production or the consumers.

2. Economic activities:
It is concerned with earning profits and generating wealth, which are measured in terms of money. Economic activities include production of goods and services, distribution of goods and services and the benefits generated from them.

3. Production of goods and services:
The main feature of business is to produce goods and services. Business is concerned with the production of goods and services to the society. In this process we get goods from shopkeeper, shopkeeper gets from wholesaler. The wholesaler gets from manufacturers. The shopkeeper, the wholesaler, the manufacturer are doing business to earn profit.

4. Risk and uncertainty:
There is no business if there is no risk but accidents never knock the door. In future anything may happen. So risk is a possibility that losses may occur. Introduction of new product, change in government policies, change in customer taste and preference etc are the risks.

5. Profit motive:
Business has the main aim to earn profit. To get maximum profit revenue of business should be maximized. Profit generation is vital for business survival and expansion. However, profit should be earned through legal and fair means and in ethical manner. Profit is the reward for the investors.

6. Continuous process:
Continuous process means to provide goods and services by the business to the customers continuously and regularly. In business, the exchange of goods and services is a regular feature. A businessman regularly deals in a number of transactions and not just one or two transactions.

7. Satisfaction of customers:
The aim of business is to satisfy human demands by producing quality of goods and also to supply right product in right time at right place to meet the right needs. Quality goods should be provided at reasonable price.

8. Finance:
Finance is known as “life blood” of business. Business needs investment of capital and to run smoothly. For regular and continuous business finance is needed, finance includes purchase of raw materials, payment of wages, assets of business and so in.

9. Organizing:
It means integration of all activities. Co-ordination is very important for organizing. Allocation of limited resource, assigning job, authority and responsibility also comes under organizing.

Importance of office management

Business Studies XI Notes — Sun, 18 Aug 2013 05:41:42 +0000

Some importance of office management are listed below:

1. Achievement of goals
Office management helps in increases office efficiency, smooth flow of work, maintaining public relations, minimization of cost, managing change and accepting the new challenges which help in achievement of goals of the organization.

2. Increases office efficiency
Office management focuses on office activities and helps office in economical way.

3. Smooth flow of work
Office management helps in performing efficient and effective office work. It helps in proper planning and effective control in office.

4. Public relations
There must be good public relation of the organization. The main purpose of public relation is to make the organization look trust worthy to all people who deal with it in all its action. It helps in increasing the goodwill of the organization.

5. Minimization of cost
Office management guides the use of capital, natural, financial, human and other resources effectively without leakage and wastage which helps in minimization of cost.

6. Managing change
Office management helps in implementation of plans in right time and in right way. Bu there may be change in resources, need, technology, preferences and so on which makes it necessary to bring about the change in plans. Office management makes the office flexible which helps to manage the change.

7. New challenges
In an office, to achieve goals, many challenges should be faced. It helps in improving the research and information system. It helps in managing all the rigid matters.